Correlation Between Dunham Floating and Ftfa Franklin
Can any of the company-specific risk be diversified away by investing in both Dunham Floating and Ftfa Franklin at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dunham Floating and Ftfa Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Floating Rate and Ftfa Franklin Templeton Growth, you can compare the effects of market volatilities on Dunham Floating and Ftfa Franklin and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dunham Floating with a short position of Ftfa Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Floating and Ftfa Franklin.
Diversification Opportunities for Dunham Floating and Ftfa Franklin
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dunham and Ftfa is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Floating Rate and Ftfa Franklin Templeton Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftfa Franklin Templeton and Dunham Floating is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dunham Floating Rate are associated (or correlated) with Ftfa Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftfa Franklin Templeton has no effect on the direction of Dunham Floating i.e., Dunham Floating and Ftfa Franklin go up and down completely randomly.
Pair Corralation between Dunham Floating and Ftfa Franklin
Assuming the 90 days horizon Dunham Floating is expected to generate 10.15 times less return on investment than Ftfa Franklin. But when comparing it to its historical volatility, Dunham Floating Rate is 4.29 times less risky than Ftfa Franklin. It trades about 0.14 of its potential returns per unit of risk. Ftfa Franklin Templeton Growth is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 2,048 in Ftfa Franklin Templeton Growth on September 3, 2024 and sell it today you would earn a total of 73.00 from holding Ftfa Franklin Templeton Growth or generate 3.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Floating Rate vs. Ftfa Franklin Templeton Growth
Performance |
| Timeline |
| Dunham Floating Rate |
| Ftfa Franklin Templeton |
Dunham Floating and Ftfa Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Floating and Ftfa Franklin
The main advantage of trading using opposite Dunham Floating and Ftfa Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Floating position performs unexpectedly, Ftfa Franklin can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ftfa Franklin will offset losses from the drop in Ftfa Franklin's long position.| Dunham Floating vs. Ftfa Franklin Templeton Growth | Dunham Floating vs. Rational Defensive Growth | Dunham Floating vs. L Abbett Growth | Dunham Floating vs. Goldman Sachs Growth |
| Ftfa Franklin vs. American Funds The | Ftfa Franklin vs. American Funds The | Ftfa Franklin vs. Income Fund Of | Ftfa Franklin vs. Income Fund Of |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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